RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/COMTD/AFT/M/3 
19 September 2007 
 (07-3920) 
Committee on Trade and Development 
Third Session on Aid for Trade  
 
 
NOTE ON THE MEETING OF 9 JULY 2007 
 
Chairman:  H.E. Mr. Shree B.C. Servansing (Mauritius) 
  
A.
 ADOPTION OF THE AGENDA .........................................................................................................1  
B. TRENDS IN TRADE -RELATED INFRASTRUCTURE INVESTMENTS ...................................................1  
C. OTHER BUSINESS .......................................................................................................................10  
 
 
A. ADOPTION OF THE AGENDA  
1. The draft agenda for the meeting as contai ned in Airgram WTO/AIR/3042 of 29 June 2007 
was adopted . 
B. TRENDS IN TRADE -RELATED INFRASTRUCTURE INVESTMENTS  
2. The Chairman  recalled that the purpose of the meeting was to begin an examination of 
"Trends in trade-related infrastructure investments" .  This was a central pillar of Aid for Trade and 
one of the main categories identified by the Aid fo r Trade Task Force.  He informed Members that 
representatives from the World Bank, Japan, the Eu ropean Communities and the Organization for 
Economic Cooperation and Developm ent (OECD) would provide comments as to their respective 
activities in this area. 
3. The representative of the World Bank  said that investment in infrastructure was essential to 
improving competitiveness, to increasing trade and to expanding economic growth and incomes.  He 
said that money to invest in infrastructure was ba dly needed, but money alone could not resolve the 
infrastructure shortage.  Equally important were in centives to invest, competition to drive productivity 
and universal access that allowed ev eryone to participate in economic development.  He said that the 
World Bank was one of the largest financiers of infrastructure for Aid for Trade to low-income 
countries.  To continue in this role, the Worl d Bank would need to replenish the funding of the 
International Development Association (IDA), whic h was a soft-loan window of multilateral lending. 
4. Regarding the question of what kinds of infrastruct ure were trade related, he said that one of 
the areas that first came to mind was telecommunications.  He explained that the telecommunications sector was very important in so far as it helped to  develop business linkages with the global economy.  
In 1998 there were 180 million users of the Internet , with only 10 per cent of users located in 
developing countries.  However, at present, there we re over a billion users of the Internet worldwide, 
with 30 per cent located in developing countries.  He said that if a country was not hooked up to the Internet, it was lagging in global competition.  If the rural countryside was not connected to the 
Internet, it was at a clear disadvantage. 
5. He said that transportation was also an important part of infrastructure.  This included roads, 
bridges, ports and air transport.  He noted that around 30 per cent of exports from developing WT/COMTD/AFT/M/3 
Page 2  
 
  countries were now being transported by airfreight .  Another area was energy.  Energy was very 
important because the cost of energy as electricity, fo r example, was incorporated into the price of all 
products.  Water and sanitation were also associated  to some degree with the global marketplace.  For 
instance, an irrigation project could be used to produce crops for the global market, but if the water was also used to produce local food efficiently, th is could help curb food imports.  Education was 
another important area which helped to in crease competitiveness in the long run.   
6. The World Bank representative added that telecommunications were essential to 
competitiveness, but said that many developing countr ies still suffered from huge cost disadvantages.  
Telecommunications networks were a country's link to global export markets, to technology and data 
and to services exports.  In this respect, he noted th at costs in developing countries were often several 
times those of developed countries.  Also, service quality and, in particular, reliability in some 
developing countries was substantially below international standards.  This was mostly due to lack of 
investment in equipment, to a lack of compe tition in a given market and to poor regulation. 
7. He explained that raising the efficiency of port services could make inputs cheaper and hence 
exports more competitive.  Countries such as Ta nzania, Kenya and Mozam bique had much higher 
import costs, measured in dollars per container, than  either Malaysia and Singapore.  He explained 
that the problems in Kenya were common to many c ountries.  Some of these problems were due to a 
lack of investment which caused delays in movi ng containers.  He said that requiring 100 per cent 
physical inspection of shipments, for security or  revenue collection purposes, was inefficient and led 
to long delays in getting goods through customs. 
8. Regarding roads, he said that in Sub-Saharan A frica most trade was restricted to a few major 
corridors, mostly along the coast.  He said the cost to link those cities in Africa with a population of 
over 500,000 with adequate roads would be about US$20 billion, pl us an additional US$1 billion in 
annual maintenance costs.  Improving the transporta tion infrastructure by building roads could have 
an effect of increasing trade by US$250 billion in 15 years, bringing major benefits for the rural poor. 
9. He noted that access to water would require ev er greater investments, as population growth 
and global warming reduced per capita availabilit y of water.  This could also affect the 
competitiveness of certain developing countries and re quire investment to adjust to new conditions 
brought on by climate change. 
10. On the issue of financing needs, the repr esentative of the World Bank said that the 
expenditure needs for lower-income countries re presented between 7.5 to 9 per cent of Gross 
Domestic Product (GDP) annually.  He noted that  about half of that amount was already being 
invested.  This meant that low-income countri es would require about US$100 billion a year of 
investment, half of which had yet to be financed .  Since Aid for Trade could only supply a small 
portion of the financing needs, more resources wo uld have to be made available, not only from 
foreign sources, but also from domestic sources.  Around one fifth of the financing needs of lower-income countries were already covered by the private sector.  He noted that official 
development assistance (ODA) covered only 10 per cent of the financing needs of lower income 
countries.  Therefore, it was governments and public utilities that were supplying the bulk of investment and finance for infrastructure in developing countries.  
11. He went on to say that the needs for Aid for Trade in infrastructure went beyond just donor 
and treasury finance.  It was necessary to achieve  more investment productivity improvements, as 
well as universal access.  He noted that invest ments from sources other than treasuries and donors 
were very important.  Some of these other sources for investment included: user fees, retained 
earnings of state and private enterprises, new private investments, and new foreign investment.  All of these sources required an incentive and regulatory fra mework that ensured that state and private 
enterprises would  reinvest their earnings and continue to expand relative to demand.    WT/COMTD/AFT/M/3 
 Page 3 
 
 
  12. He said that investment was only one part of th e solution, productivity of investment was also 
a very important issue.  Moreover, it was necessar y to have an improved regulatory framework that 
expanded competition to drive producti vity improvements.  He said that another aspect was expanded 
access of the poor to network services through universal access policies.  He said that a recent study 
on telecommunications in Africa had shown that companies that had been privatized without a 
competitive framework were not as productive as tho se that faced competition in their market, 
because competition drove productivity.  A similar resu lt had been observed in the reform of China's 
electricity industry.  
13. He pointed out that universal access in netw ork infrastructure industries was also very 
important.  He said that it was important that the poor had access to network services in order to fully 
harvest their productive potential.  Forty per cent of people living in rural areas in developing 
countries did not have access to all-weather roads.  This meant that they could not sell their products on time and at a lower cost, and could not have access to the global market place.  He noted that 
studies done by the World Bank had found, that in  the telecommunications sector, a 10 per cent 
increase in telecommunications density was associated  with a 0.6 per cent a dditional growth in GDP 
over the same period.  Therefore, there is a relati onship between infrastructure and economic growth.  
Moreover, universal access created opportunities fo r small- and medium-size enterprises, thereby 
allowing countries to tap the inventiveness a nd entrepreneurial spirit of their citizens. 
14. He explained that although ODA had doubled  since 1990, the amount of financing for 
infrastructure had been falling as a percentage of total ODA.  Currently financing for infrastructure 
was only 30 per cent of ODA.  This was because fi nancing had shifted towards social sectors and 
towards debt reduction.   
15. He noted that the World Bank's commitments fo r infrastructure had also fallen since 1996.  
However, there had been a slight increase of investment in infrastructure after 2000.  Most 
non-concessional lending was provided to middle-in come countries, while low-income countries 
obtained concessional lending.  This meant that the World Bank lending to low-income countries  
depended on a replenishment of the International Development Association (IDA) window.  He said 
that if the IDA window was replenished, the Worl d Bank could increase infrastructure investment in 
Africa by 30 per cent. 
16. In conclusion, he said that donor investment  in infrastructure was a necessary, but not 
sufficient condition for trade expansion.  Incentiv es, competition and universal access were equally 
important.  He added that even though most invest ment would come from domestic sources, Aid for 
Trade was an important part of financing.  Bu t Aid for Trade could only expand if the overall 
envelope for aid was also expanded,  as pledged at  the Gleneagles summit and the IDA-15 meeting.   
17. The representative of Benin
 asked how the World Bank could help developing countries to 
build road infrastructure and what amount of res ources were available for this purpose.  He also 
quoted an African proverb that said "the road to  development is the development of the road". 
18. The representative of India  asked how long would it take to complete the US$20 billion 
investment in African roads that  was used as an example in th e presentation by the World Bank 
representative.  
19. Regarding the issue of national invest ments, the representative of Senegal  said that given the 
weakness of saving levels in African countries, th e international community needed to continue to 
make a contribution.  He said that in many sectors, such as telecommunications and sanitation, 
African countries had carried out an extensive pr ivatization programme which had resulted in the 
newly privatized companies making enormous profits.  He wanted to know if the World Bank had any WT/COMTD/AFT/M/3 
Page 4  
 
  figures on the amounts reinvested in infrastructure by the privatized companies and how these 
reinvestment levels compared to companies in developed countries. 
20. The representative of Kenya
 requested that the references to  some of the research studies 
cited in the presentation be made available to Memb ers.  He also asked how the US$20 billion for the 
improvement of African roads could be raised and inv ested.  Lastly, he asked for clarification on what 
was the IDA-15. 
21. The representative of Switzerland  said that even though the amount of investment was 
important, the quality of investment was also an im portant factor to be taken into account.  The 
quality of investment was related to the sustainability  of the investment.  Both  were necessary for the 
investment to generate productivity and competiti veness gains.  He asked to what extent the 
World Bank Group had taken into account the regional  dimension of infrastructure and implemented 
projects on a regional basis. 
22. The representative of Rwanda  said that it was important to establish parameters in order to 
efficiently monitor the implementation of Aid for Tr ade.  He asked why donors had shifted to social 
issues rather than infrastructure-related developm ent.  He said that regarding the African road 
network, the current situation reflected Africa's co lonial past where roads were built by the colonizers 
to extract and export Africa's natural resources.  Th erefore, intra-African trade had been neglected.  
He said that intra-African trade needed to be promoted along with the necessary infrastructure 
investment to generate regional integration in Africa. 
23. In regard to the questions by the represen tatives of Benin and Senegal, the World Bank  
representative said that it was important to focus on r estrictions to competition in the African markets 
and to provide a stable investment regulatory framewo rk to encourage reinvestment by the privatized 
companies.  He noted that the World Bank expect ed to use the new resources in IDA-15 to increase 
investment in African infrastructure by US$1 to 1.5 billion each year. 
24. Regarding the question posed by the representa tive of India, he said that there was no 
particular timeframe for the investment in roads a nd that the cost estimation was only an example.  
However, the simulation was based on a econometric model that concluded that the benefits would 
appear after each segment of the road had been completed. 
25. Regarding the request by the representative of Keny a, he said that the reference to the studies 
used in the presentation were given in the last pa ge of the handouts.  He said that a US$20 billion 
investment was very reasonable and should not be very  difficult to raise and invest.  Therefore, he 
advised African countries to start campaigning to raise the US$20 billion needed for road 
infrastructure.  He explained that the IDA-15 was the fifteenth replenishment of the soft-loan window 
of the World Bank. 
26. Regarding the comment by the Swiss representative,  he said that quality was important and so 
was maintenance.  
27. Addressing the comment by the representative of Rwanda, he said that regional arrangements 
and trade facilitation were also important to increase intra-African trade.  Therefore, regional projects 
involving regional infrastructure development and improving trade facilitation at border crossings 
were very effective.  Concerning the question of the shift away from infrastructure development by 
donors, he said that donors had shifted their interest as a result of recipient demand.  He noted that 
there was also an erroneous perception that the private sector would carry out an important share of infrastructure investment.  WT/COMTD/AFT/M/3 
 Page 5 
 
 
  28. In his presentation on trends on trade-related in frastructure investments, the representative of 
Japan  said that infrastructure development was part of Japan's development initiative for trade.  He 
said that the particular situation of each region or  country was different.  Therefore, his presentation 
was not intended to provide a one-size-fits-all solu tion.  Rather, his presentation should be seen as an 
input of Japan's experience.  
29. He added that the definition of economic infr astructure used in his presentation included three 
areas:  transport and storage;  communications;  ener gy generation and supply.  This was very similar 
to the definition used by the OECD's Deve lopment Cooperation Directorate-(DAC) and the 
World Bank. 
30. He said that Japanese development assistance had been progressively changing, responding to 
changes in international conditions.  However, th ere were three constant principles.  First, 
development of a country was based on its own effo rts.  Second, the ultimate purpose of development 
was the well-being of the people, and this could only be achieved through a balanced approach of 
economic and social development.  Third, infrast ructure, economic developm ent and trade expansion 
were deeply inter-related. 
31. He pointed out that one important element whic h would enable trade expansion was to attract 
Foreign Direct Investment (FDI) in order to build  capacity for producing competitive products.  He 
added that infrastructure played an important role  in attracting FDI.  In this sense, building up 
infrastructure was considered to be an im portant element for expanding trade.   
32. He explained that economic growth in many Asian nations was driven by an increase in 
exports and that the essential element for increasing e xports was the production of goods with a high 
level of competitiveness.  Such production was of ten realized through FD I.  Although building 
infrastructure did not guarantee an increase of FDI, it could often facilitate FDI, when companies willing to invest, needed such infrastructure.  He noted that a survey of Japanese companies indicated 
that developed infrastructure was one of the main factors taken into account when deciding where to 
make production investments.  
33. He said that one of the best examples of  Japanese ODA was Jap an's cooperation with 
Viet Nam.  He explained that according to sta tistics of the OECD-DAC database, Japan's ODA to 
Viet Nam amounted to US$603 million in 2005.  This amount was roughly half of the ODA disbursement made in the same year by all the ot her DAC donor countries.  One of the characteristics 
of Japan's aid to Viet Nam was that a large portion of ODA, as much as 79 per cent, had been 
allocated to infrastructure development.  This had been done in response to the priorities expressed by 
the Vietnamese Government.   
34. He explained that one of Japan's specific proj ects was the Viet Nam-Japan Joint Initiative.  
The objective of this initiative was to improve the business environment in Viet Nam, with a view to 
strengthening Vietnamese competitiveness.  When Japa n and Viet Nam had started this work in 2003, 
Viet Nam had faced dramatic changes in its ec onomic environment, including accession to WTO and 
a bilateral investment agreement  with Japan.  He further explained that an action plan was reached 
after consultation with companies in Viet Nam and discussion with the Vietnamese Government.  This action plan included promoting the use of infrastructure financing from Japan's Bank for 
International Cooperation (JBIC).   
35. He went on to say that there were sever al infrastructure projects related to the 
Viet Nam-Japan Joint Initiative.  These included projects in transportation and energy, such as 
bridges, highways and port construction project s, and projects concerning the rehabilitation and 
construction of power plants.  WT/COMTD/AFT/M/3 
Page 6  
 
  36. The representative of Japan also provided deta ils on two of the projects, the Bihn Bridge 
Construction Project and the Pha Lai Thermal Powe r Plant Project.  He said for the Bihn Bridge 
project in Hai Phong, the JBIC had provided an 8 billion yen loan to construct a new 1,300 metre 
bridge across the Cam river and improve related fa cilities such as access road s.  This replaced the 
existing ferry service, improving transportation with in the city, and helped to improve the city's 
transportation and distribution efficiency, especially in the northern parts of the country.  Concerning 
the Pha Lai Thermal Power Plant Project, the JBIC  had provided a loan amounting to 8.5 billion yen 
to build a new coal thermal power plant, with a to tal capacity of 600 Mega Watts (MW).  This project 
was designed to support the electric power consump tion needs of a large area in northern Viet Nam 
that included Hanoi and Hai Phong.   
37. He explained that investment and trade had increased significantly since the beginning of 
Japanese cooperation with Viet Nam.  These figures had also generated increased GDP growth in 
Viet Nam. 
38. Regarding Japanese cooperation in Africa, he  said that in 2005 Japan and the African 
Development Bank had started the Enhanced Privat e Sector Assistance for Africa (EPSA) project.  
The objective of this initiative was to support private sector development in Africa by co-financing 
private sector development in:  (i) economic and social  infrastructure development, (ii) private sector 
development and (iii) agriculture sector development.   He said the maximum estimated amount to be 
allocated for this initiative was US$1 billion, to be provided over five years.   
39. He said one of the examples of the EPSA  was road improvement on the southbound 
Bamako-Dakar corridor and explained that the objectiv e of this project was the construction of an 
international highway linking Dakar and Bamako, plus farm roads bran ching off from the highway.  It 
was expected that the project would provide an a dvanced distribution route for Mali's farm and other 
products to Dakar, invigorate the local economic ac tivities and upgrade living standards in the region. 
40. Concerning Japan's New Development Initiative fo r Trade, he said that this project was 
launched by former Japanese Prime Minister Koisumi in 2005.  He explained that the Initiative was 
based on three pillars which included supply-side  support in production, distribution and export 
support and duty-free, quota free access for LDCs.  He noted that financial assistance and 
concessionary loans for infrastructure played an importan t part of this initiative.  He explained that the 
New Development Initiative for Trade was currently  being implemented and Japan's authorities had 
recently sent high-level missions to some African countries. 
41. In conclusion, he said that FDI was key for co mpetitive export production.  Infrastructure was 
one of the necessary conditions to make a country or a region attractive for FDI.  He said that in its 
economic cooperation efforts, the Government of Japan would continue to place emphasis on 
investment in economic infrastructure, in  particular transportation and energy. 
42. The representative of th e European Communities
 said that he fully agreed with the WTO Aid 
for Trade Task Force recommendations to include in frastructure as part of Aid for Trade, but only 
when it was part of a trade strategy.  This was an  incentive to bring together the more narrow trade 
agenda and the infrastructure development agenda.  He believed that in order to increase trade it was 
important to have the hardware – i.e. the infrastru cture – in place but also to have access to a legal 
framework which allowed products to reach consumers.   The view of the EC was that the integration 
of aid with infrastructure and aid for regulatory re form had to be done during the diagnostic process.  
Integrated aid for infrastructure and trade would onl y be provided by the EC as a response to concrete 
demands. 
43. He said that the EC had not made pledges with respect to infrastructure in the context of Aid 
for Trade.  This was because the EC believed that  providing capacity building to trade agencies would  WT/COMTD/AFT/M/3 
 Page 7 
 
 
  leverage the need for countries to come up with de mands for infrastructure related Aid for Trade.  The 
EC had recently adopted a general framework for development policy, called the European 
Consensus, where trade and infrastructure were tw o separate items.  Infrastructure was now being 
addressed in the context of poverty reduction and through the promotion of economic growth.  
Infrastructure was a clear priority and there was a competitive advantage for the EC to provide aid in 
this area since it had experience in building infrast ructure to integrate the European market.  He 
recalled that the EC average comm itments for infrastructure development for the years 2002 to 2005 
amounted €1.2 billion from the European Commission with  an additional €2 billion being provided by 
the individual EC member States. 
44. As an example of the EC's activities on infrast ructure development, he cited the EU-Africa 
Partnership on Infrastructure.  He said that th e policy context behind the initiative was the EU's 
Strategy for Africa.  This strategy identified infrast ructure as a priority in the provision of aid to 
Africa.  The European Council had concluded that  limited access to transport and communication 
services, water and sanitation, and energy all constrai ned Africa's growth.  This had often resulted in 
trade and commerce becoming uncompetitive.  The Council had also concluded that there were 
several missing links in Africa's infrastructure netw ork.  These needed to be identified and addressed.  
45. He said that the EU Partnership was a res ponse to the African Union-New Partnership for 
Africa's Development  (AU-NEPAD) Infrastructure Plan.  He noted  that there were still some serious 
gaps in funding.  He explained that for the EC to reach its target of increasing development 
cooperation by €20 billion by 2010, 50 per cent of which would be allo cated to Africa, it would need 
the involvement of private stake holders and non-ODA resources. 
46. He pointed out that the scope of the Partnershi p included infrastructure in the widest sense. 
This included transport networ ks, water and energy, informa tion and communication technology 
(ICT) infrastructure and services.  The Partnership also included investments in trans-boundary and 
regional infrastructure, as well as regulatory frameworks for service delivery. 
47. Regarding the funding of the Partnership, he sai d that if current levels of funding were 
maintained, the Partnership would have funds amoun ting to €5.9 billion for th e period 2008 to 2013. 
This sum would be in addition to the aid provided by the individual EU countries.  There were also separate resources available for water and energy projects.  
48. He said that the EC had created the EU-Africa Infrastructure Trust Fund in 2006 and that the 
Trust Fund was a financial instrument of the Infrast ructure Partnership, which covered investments in 
national, regional and continental ne tworks.  Part of the Trust Fund would be dedicated to grants and 
another to loans.  Funding for grants amounted to  €60 million from the European Commission and an 
additional €27 million from EC members States.  On the issue of loans, he said that the European 
Investment Bank would mobilize up to €260 million in loans for the period 2007 to 2008.  Other 
investment banks would be linked to the Fund in the future. 
49. He added that the operational principles of the Trust Fund were: coherence and 
complementarity with country and regional progra mmes, African ownership, and an increase in 
funding and flexible methods of financing through the blending of grants and loans and close coordination with non-EU development institutions working in Africa. 
50. He said that the modalities of the fund had just  been approved in 2007 with the objective of 
generating additional grant resources from the Europe an Development Fund and EU bilateral sources.  
He was confident that the Trust Fund would m obilize increased resources in support of African 
infrastructure networks. WT/COMTD/AFT/M/3 
Page 8  
 
  51. In conclusion, he said that it was very clear th at the EC considered infrastructure development 
a priority of Aid for Trade, alongside traditiona l development aid.  However, mainstreaming 
infrastructure in trade programmes and development was absolutely critical to mobilizing increased 
funding for infrastructure and to have access to  increased resources.  Even if the European 
Commission were able to increase resources for investme nt in infrastructure, it was clear that other 
resources from governments, development banks and the private sector would be necessary to fill the 
funding gaps. 
52. The representative of the Organisation fo r Economic Co-operation and Development
 (OECD) 
said that he would present an overview of total donor ODA commitments.  He would then cover the 
ODA commitments on trade-related elements of in frastructure and conclude by reflecting on an 
OECD-DAC consensus on how donors should beha ve when delivering aid for infrastructure 
development.  He said that it had been estimated  that currently 1 billion people worldwide did not 
have access to road networks, 1.2 billion did not  have safe water and 2.4 billion lacked sanitation 
facilities.  Another 2.3 billion people had no relia ble source of energy and 4 billion were without 
modern IT facilities.  There was a significant gap between needed spending and current spending on 
infrastructure, particularly in Sub-Saharan Africa.   
53. In the context of these unmet needs, he said th at over the period 1984 to 2003 all sources of 
infrastructure finance had declined.  He added that  public spending on infrastructure fell considerably 
in Africa and Latin America.  At the same time , infrastructure's share of total bilateral ODA had 
declined from 35 per cent to 15 per cent.  Private i nvestments in infrastructure did not fill the gap.  
The private sector accounted for over 25 per cent of infrastructure investment in the developing world 
in the period 1990 to 2000.  The ODA contributed on ly 5 per cent of investment in infrastructure over 
the same period, although recently  this had risen to 8 per cent. 
54. He said that there were three main categories of trade-related ODA: transport and storage, 
communications and energy.  He explained that transport and storage received the largest share of ODA in the period 2001 to 2005.  Overall, ODA had r eached a peak in 2004 due to dam construction 
projects in Azerbaijan, Viet Nam and Iran, as well as transport projects in Viet Nam, Thailand and 
Indonesia.  These three categories were proxies for trade-related ODA, though some of them were 
probably not actually trade related.  He hoped that with the WTO Aid for Trade monitoring mechanism, the statistics would improve and captu re only the trade-relevant investments.   
55. He pointed out that there had been a lot of research conducted on how investment in 
infrastructure resulted in economic growth and in creased productivity.  However, there was less 
research on the trade effects of investment in in frastructure.  One recent World Bank policy research 
paper found that transport and communications infrast ructure, together with institutional quality, were 
significant drivers of export volumes and of the like lihood that a country would export.  Infrastructure 
and institutional quality were even more important than  variations in tariffs in explaining changes in 
North-South trade.  
56. He said that the Asia-Pacific region was the la rgest recipient of infrastructure ODA.  This  
reflected in part Japan's role as an infrastructure don or and the concentration of its support in its own 
region.  He added that, from the income perspectiv e, lower, middle-income countries predominated as 
recipients of ODA infrastructure commitments.  Money spent on regional and multi-country 
programmes was relatively small.  This was unfor tunate because these programmes could have a high 
trade inducing and trade development impact, especia lly given the problems of land-locked countries 
and large distances to trading routes faced by some of the poorer countries.  Therefore, there was a 
mismatch between trade promoting opportunity a nd ODA commitments.  He believed that this 
probably reflected the difficulties in coordination a nd transaction costs of multi-country initiatives, as 
well as the institutional constraints of lending to regional entities.   WT/COMTD/AFT/M/3 
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  57. He went on to say that Japan was the la rgest infrastructure donor, followed by the 
United States and the EC.  He emphasized that th is was ODA and not lending, and if some lending 
was reflected it involved at least a 25 per cent grant component. 
58. He said that the OECD-DAC had developed a consensus framework for the donors in meeting 
infrastructure challenges.  This c onsensus framework had four guidin g principles.  The first was the 
use of partner-led frameworks as a basis for coordi nated donor support.  The second, the enhancement 
of infrastructure's impact on the poor.  Third, improving management of infrastructure investment to achieve sustainable outcomes, and fourth, increasing infrastructure financing and using all financial 
resources efficiently.  He expanded on the last principle by saying that donors should provide predictable, long-term support to infrastructure, they should provide a diverse mix of financial 
instruments, build capacity in capital and financ ial markets and develop regional, national and 
sub-sovereign financing mechanisms.  
59. Regarding an assessment of the impact of infrastructure ODA, he said that donors should 
strengthen country capacity to genera te relevant indicators and data.  They should also engage in joint 
monitoring and evaluation, as well as  encourage simple, harmonized, ex-ante  poverty impact 
assessments.  He said that evaluating the impact of infrastructure presented some particular challenges 
due to the inability of establishing control groups to conduct experimental impact assessments.  
Moreover, there was a challenge in assessing the increm ental impact of investment in areas that had a 
network character, such as roads or an electric gr id, that depended on when and where the investment 
occurred.  Some of these areas had many different us es and could have an igniting effect on structural 
change throughout the economy.  Nevertheless, he  said that donors could do more on evaluation. 
They could, for example, use input/output econometric models in the context of aid. 
60. On monitoring implementation, he said that donors should monitor and evaluate 
implementation of the guiding principles (e.g., throu gh peer reviews) and develop indicators to gauge 
implementation (e.g., percentage of economic infrast ructure in donor portfolios).  He concluded his 
presentation by saying that most of the data pr esented was publicly available on the OECD-DAC's 
website at www.oecd.o rg/dac/stats/idsonline.   
61. On the issue of monitoring, the representative of Benin
 suggested that donors should work 
with the Secretariat to prepare th e Aid for Trade Session of the Ge neral Council in November.  This 
would allow them to pool resources and provide  Members with information on the situation 
concerning funding amounts, timeframes and sectors of investment.  He asked the representative of 
Japan about the status of an Aid for Trade project that the Government of Benin had submitted to the 
Japanese development authorities for their consideration. 
62. The representative of India  said that Minister Akika Amari of Japan, accompanied by a 
delegation of Japanese Business Executives, had recen tly visited India to participate in discussions 
relating to the Delhi-Mumbai Industrial Corridor (D MIC) and the meeting of the second, Japan-India 
synergy dialogue.  It was announced during the visit that the Delhi-Mumbai Industrial Corridor 
project, with an estimated investment of US$90 billion  over seven years, was at  an advanced stage of 
finalization.  He explained that the project was c onceived to develop global manufacturing and trading 
in the region.  The project was expected to double employment potential, triple industrial output and quadruple exports from the region in five years.  Most of the new employment opportunities would be 
in the manufacturing and processing sectors.  The project would see a major expansion of infrastructure and industry, including the developmen t of industrial clusters, with rail, road, boat and 
air connectivity in the states along the corridor.  He said that the stakeholders had taken a decision to 
set up five investment regions and five industrial re gions, one in each state in Phase 1 of the project.  
The first phase was scheduled to be completed by 2012 in synchronization with the dedicated rail 
freight corridor.  The approach in the DMIC project  was to work within the present system of policies 
and incentives and provide global quality infrastruct ure to spur further industrial growth.  He WT/COMTD/AFT/M/3 
Page 10  
 
  expressed confidence that the DMIC would become  another example of Indo-Japanese collaboration 
following India's successful experience with Japan  in the development of the Delhi metro. 
63. The representative of Swaziland
 asked the representative of Japan to expand on the 
functioning of the one-village-one-product programme.  
64. The representative of Nigeria  asked the representative of Japan what were the conditions 
stipulated for the beneficiary countries in the one-village-one-product programme. 
65. Regarding the question by Benin, the representative of Japan  said that he was not aware of the 
specific requests of each country but would like to  follow-up on the question bilaterally.  The one 
village, one product programme was based on Japan's own experience and was originally proposed by 
leaders of the less industrialized prefectures in Jap an.  This programme advocated the need for poorer 
regions to focus on the production of one product as a basis for development in that region.  He said 
that JICA, the Japanese International Cooperation Agency, had dispatched experts to ten African 
countries on one-village-one-product missions.  He sai d that there were no real conditions or any 
specific model that was imposed on the recipient countries.  He added that discussions on adapting the programme to local conditions were held between the Japanese mi ssions and the authorities of the 
recipient governments. 
66. The representative of Angola
 said his country had just emerged from a 30-year old civil war 
and was going through a reconstruction process.  Therefore, increased ODA for infrastructure development was needed.  However, some of the donors had responded to Angola's requests by 
stating that Angola had enough na tural resources and should be able to address its problems on its 
own.  He asked the representative of the EC as to  how, using the EU-Africa partnership, it would be 
possible to overturn this misconception.  
67. The representative of the European Communities
 said that he would consult with his capital 
and provide a bilateral response. 
68. The representative of Zimbabwe  asked the representative of the OECD whether it had plans 
to better align future assistance with the requirement s of the beneficiary countries, especially since 
there were large gaps between the assistance that was being provided for a particular sector and the 
needs of the population. 
69. The representative of the OECD  said that the OECD was neither a donor nor a development 
agency.  He was not aware of any plans by the do nor community to equalize spending in all of the 
different areas of infrastructure.  
70. The Chairman  thanked the speakers and all the Members for their thought provoking 
interventions.   
C. OTHER BUSINESS  
71. The Chairman  informed Members of a change in the Aid for Trade Calendar of Events and 
said that this change would appear in a revision  of the calendar that would be circulated as 
document WT/COMTD/AFT/W/2/Rev.2. 
72. Also on the subject of the Regional Reviews, he  announced that invitation letters for the Latin 
America/Caribbean and Asian/Pacific events, scheduled for 13 to 14 September and 19 to 20 September 2007, respectively, had been sent to  Trade, Finance and Development Ministers.  
Copies of these letters would be circulated to dele gations shortly.  He informed Members that they 
could also access up-to-date information on the regional reviews directly on  WT/COMTD/AFT/M/3 
 Page 11 
 
 
  www.aric.adb.org/aft_asia.php – for the Asia event – and on www.iadb.org/aidfortrafe - for the Latin 
America and Caribbean event.  Links to these websites would be provided in the WTO's Aid for Trade webpage. 
73. The meeting was adjourned
. 
__________